Blockchain Technology in Corporate Governance: Advantages and Limitations

Abstract

This paper is a literature review paper. We discussed the influence and results of using blockchain in corporate governance. In this paper, we considered both the advantages and disadvantages of using blockchain technology. Our research areas included distributed ledgers, smart contracts, corporate governance, DAO “hack” case (2016), blockchain distributed platform, the decentralized autonomous organization (DAO), customer loyalty plan using blockchain, the proof-of-work system using blockchain, and the blockchain technology in international business. We selected a sample of around 20 articles on blockchain to study the benefit of using blockchain in corporate governance. Based on the convenience and effectiveness of using blockchain, we made the hypothesis that using blockchain in corporate governance would be able to have more transparent, real-time, reliable, cost-effective, verifiable, and accessible transaction records. We hypothesize that using blockchain in corporate governance has more benefits than using the database. Blockchain technology also has some disadvantages such as shareholder protection weakness, fraud transactions, anonymous voting, etc. Generally speaking, based on our analysis of selected articles and literature reviews, we made the following conclusion that blockchain technology will have more benefits in corporate governance compared to traditional systems and other database management systems.